The copper price on the Shanghai Futures Exchange continued to decline during Asian morning trading hours on Thursday November 30, despite a positive reading in China's Purchasing Manufacturers' Index (PMI).

The most-traded January copper contract on the SHFE stood at 52,630 yuan ($7,967) per tonne as of 10.43am Shanghai time, down by 520 yuan from the previous session’s close.

Investors remained cautious towards the futures market, mainly due to weak Chinese copper demand. As a result, profit-taking has become the dominant theme in the market so far this week.

This is despite China's November PMI coming in this morning at 51.8, beating both the forecast of 51.4 and the previous figure of 51.6, as well as a positive US gross domestic product (GDP) reading for the third quarter.

“Although US Q3 GDP beat the forecast and rose 3.3% overnight, it did not help prevent the copper price from falling further.Weak demand for copper in China has placed too much downward pressure [on prices],” China's Citic Futures Research said.

“Base metals prices are for the most part on a back footing while investors cut long positions because prices have become hung up in high ground,” Metal Bulletin senior analyst Will Adams said.

In addition, Commerzbank pointed to concerns about a stronger dollar and the credit environment in China and how it might affect growth.

The dollar index showed some strength overnight and climbed to as high as 93.44 before falling back to 93.11 as of 10.43am Shanghai time today.

“[US Federal Reserve chair Janet Yellen] delivered a positive assessment on the economic outlook [during her speech yesterday], noting that wage gains and inflation remain tame. But she forecast strengthening ahead and signalled that further gradual rises in the Fed funds rate should be expected,” an analyst from National Australia Bank noted.

Such expressions from Yellen, though not new to the public, have further strengthened the outlook for a stronger dollar.

Meanwhile, market participants continue to see potential support for the copper price from the supply side.

London Metal Exchange copper stocks fell a further 4,950 tonnes on Thursday, and total stocks dropped below 200,000 tonnes for the first time since March.

“We see the pullbacks as consolidation and remain bullish overall on the basis of the fundamentals,” Will Adams noted.